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Entries in Background Check
(8)

On June 1, 2016, Governor Dannel Malloy signed into law Public Act 16-83, entitled “An Act Concerning Fair Chance Employment,” joining a national trend of legislation to “ban the box” in the hiring process. Effective January 1, 2017, Connecticut’s new legislation modifies C.G.S. § 31-51i and prohibits virtually any employer—public or private—from inquiring about a prospective employee’s arrests, criminal charges or convictions on an initial employment application. The statute provides two exceptions that allow an initial inquiry if (1) the employer is required to do so by an applicable state or federal law; or (2) a security or fidelity bond or an equivalent bond is required for the position for which the prospective employee is seeking employment.

The legislation does not provide a private right of action for prospective employees against a covered employer, but instead allows a complaint to be filed with the Labor Commissioner alleging an employer’s violation.

About ten (10) years ago Kaplan, the program offering graduate and undergraduate degrees to students throughout the country, learned that some employees were stealing payments that belonged to students and committing self-dealing by hiring relatives as vendors. In response, Kaplan implemented a number of policies to prevent similar abuse, one being to run credit checks on applicants for senior-executive positions, as well as any positions that had access to financial information of students or the company, or access to cash. The EEOC sued alleging disparate impact as a result of these background checks. EEOC v. Kaplan, et. al., No. 13-3408 (6th Cir. Apr. 9, 2014).

The Equal Employment Opportunity Commission (EEOC) and the Federal Trade Commission (FTC) have a common interest in educating employers, applicants and employees about the use of background checks in the employment context. The EEOC enforces federal laws against employment discrimination and the FTC enforces the Fair Credit Reporting Act (FCRA), which protects privacy and accuracy of information in credit reports. Typically, employers who conduct background checks include credit reports as part of their due diligence. The agencies partnered to create to instructive documents: Background Checks: What Employers Need to Know and Background Checks: What Job Applicants and Employees Should Know.

In August we blogged about the United States District Court for the District of Maryland’s dismissal of a claim filed by the EEOC against Freeman (an event-planning firm), where the EEOC alleged violation of Title VII through the use of criminal and background checks. On January 29, 2014, the EEOC filed its appeal to the Fourth Circuit in the matter alleging that the district court erred in its decision.

No, we’re not talking about Santa’s list, but instead the steps you take prior to hiring employees. We recognize the costs associated with hiring and training a new employee and the need to make sure that you have a proper “fit;” but be cautious if your company is using criminal background history in order to verify an individual will be a proper “fit.”

While the new year is off to a swinging start, the team at Verrill Dana wants to make sure all clients are complying with the Consumer Financial Protection Board’s (CFPB) requirement that updated Fair Credit Reporting Act (FCRA) notices be used when performing background screenings on current or potential employees. Previously, the CFPB issued regulations that called for the modification of three critical forms required by the FCRA, 15 U.S.C.§ 1681 et. seq. As of January 1, 2013, these modified forms, issued in final form by the CFPB in November 2012, are now the required notices under the FCRA.